American President Donald Trump, on January 21, revealed a new partnership involving OpenAI, Oracle, and SoftBank, which aims to invest up to $500 billion in infrastructure projects related to artificial intelligence.
OpenAI CEO Sam Altman, SoftBank CEO Masayoshi Son, and Oracle Chairman Larry Ellison joined President Donald Trump at the White House on Tuesday afternoon to announce the new initiative, described by Trump as the “largest AI infrastructure project in history.”
According to Trump, the initiative is expected to generate 100,000 jobs across the United States.
“It’s big money and high quality people,” said Trump, adding that it’s “a resounding declaration of confidence in America’s potential” under his new administration.
The companies will initially invest $100 billion in the project, named Stargate, with plans to scale up to $500 billion in the coming years.
“I think this will be the most important project of this era,” Altman said on Tuesday. “We wouldn’t be able to do this without you, Mr. President.”
Stargate Project
The Stargate Project will launch a new company to develop the infrastructure needed for training and operating large AI models, including data centers and the energy systems to power them. The first phase will involve constructing 10 data centers in Abilene, Texas, with plans for 20 in total, each spanning 500,000 square feet. The project is expected to create 100,000 jobs across various sectors.
As AI continues to grow, rising electricity demands and regulatory challenges pose significant constraints. These data centers consume vast amounts of energy, placing strain on power grids. For example, Goldman Sachs estimates that a single ChatGPT search requires 10 times the computing power of a Google search. Research from Goldman Sachs predicts that power demand from data centers will rise by 160% by 2030.
Key players behind Stargate
The initial equity funders in Stargate are Japan’s SoftBank, ChatGPT creator OpenAI, software giant Oracle, and Abu Dhabi-based AI-focused investment firm MGX. OpenAI and SoftBank are the primary partners leading the Stargate project. SoftBank will handle financial responsibilities, while OpenAI will oversee operations. SoftBank’s CEO, Masayoshi Son, will serve as the project’s chair.
Arm, Microsoft, NVIDIA, Oracle, and OpenAI are the key initial technology partners. In a blog post, OpenAI revealed that Stargate builds upon its existing collaboration with Microsoft while forging a new partnership with Oracle. “As part of Stargate, Oracle, NVIDIA, and OpenAI will closely collaborate to build and operate this computing system. This builds on a deep collaboration between OpenAI and NVIDIA going back to 2016 and a newer partnership between OpenAI and Oracle,” the company said.
“OpenAI will continue to increase its consumption of Azure as OpenAI continues its work with Microsoft with this additional compute to train leading models and deliver great products and services.”
Meanwhile, Microsoft announced on Tuesday that its exclusive cloud agreement with OpenAI had ended. The companies have now signed a “right of first refusal” deal, granting Microsoft the first opportunity to host OpenAI on its cloud services. But if Microsoft cannot meet OpenAI’s requirements, the company is free to choose a competing cloud provider.
Musk bashes Trump-backed Stargate deal
Less than two days after President Donald Trump’s major business announcement, Trump’s billionaire ally and the head of the Department of Government Efficiency (DOGE) questioned the value oquestioned the value of the investment hours later.
The world’s richest man took to X to question the announcement, replying to OpenAI’s press release with “they don’t actually have the money,” and adding that he has it on “good authority” that “SoftBank has well under $10B secured.”
Altman was quick to responded and said Musk was “wrong, as you surely know” and inviting Musk to come visit the first site in Texas that is already under construction. “This is great for the country. i realize what is great for the country isn’t always what’s optimal for your companies, but in your new role i hope you’ll mostly put (America) first,” Altman wrote, using a U.S. flag emoji to represent America.